* The JP Morgan Chase & Co trader known as the "London whale" tried to alert others at the bank to mounting risks months before his bets ballooned into more than $6 billion in losses, according to people familiar with emails reviewed by J.P. Morgan and a U.S. Senate panel.

* The U.S. government filed suit to block Anheuser-Busch InBev's $20.1 billion deal to buy the rest of Grupo Modelo, saying it would reduce competition.

* Chinese hackers believed to have government links have been conducting wide-ranging electronic surveillance of media companies including The Wall Street Journal, apparently to spy on reporters covering China and other issues, people familiar with incidents said.

* President Barack Obama let his jobs council disband Thursday as its two-year charter expired, sparking criticism among Republicans and conservative economists that the group had provided more show than substantive policy.

* Morgan Stanley said it would increase the salaries of Chairman and Chief Executive James Gorman and other top executives to make their pay more competitive.

* AirAsia Bhd's chief executive hopes to list the group's Indonesia arm on the Jakarta stock exchange in the third quarter as the budget carrier seeks to expand its foothold in Southeast Asia's largest air travel market.

* Roomy Khan, one of the first cooperating witnesses who helped build the U.S. government's case against convicted hedge-fund manager Raj Rajaratnam, was sentenced to one year in prison Thursday.

* Animal-medicine maker Zoetis Inc, which is being carved into a standalone company by drug maker Pfizer Inc, raised about $2.2 billion in an initial public offering, a strong showing for the largest IPO deal from a U.S. company since Facebook Inc debuted last May.

* Best Buy Co is closing 15 of its 75 big-box stores in Canada as its new chief executive tries to stem slumping sales and profits at the consumer electronics chain.

FT

BARCLAYS IN QATAR LOAN PROBE - UK authorities are looking into an allegation that Barclays lent Qatar money to invest in the bank during the height of the 2008 financial crisis, allowing it to avoid a government bailout, according to unnamed sources cited by the newspaper.

SEYMOUR PIERCE'S FUTURE UP IN THE AIR - The board of Seymour Pierce held talks on Thursday night over the future of the stockbroker, with an unnamed source saying this has come about due to the FSA previously blocking funding from Ukrainian backers.

AB INBEV'S 20 BILLION DOLLAR DEAL THREATENED BY US SUIT - The United States moved to block Anheuser-Busch InBev in its 20 billion dollar acquisition of Grupo Modelo , the Mexican brewer, saying it would lead to an increase in prices and deter competition.

BERTELSMANN SEEKS BUYER FOR TWO BILLION EURO RTL STAKE - German media group Bertelsmann said it intends to sell a stake in broadcasting subsidiary RTL, aiming to raise up to 2 billion euros

LAWSON URGES FULL NATIONALISATION OF RBS - Former Conservative finance minister, Nigel Lawson said the UK government should nationalise RBS and there was a case for no bonuses to paid this year.

CHINA'S WORKERS ENDURE UNHAPPY NEW YEAR - An austerity drive by the new Chinese leadership of Xi Jinping has led government departments and state-owned enterprises to cut back or cancel new year festivities.

US BANKS SQUEEZED AS MORTGAGE PROFITS HIT - Bonanza profits at US banks from mortgages are being squeezed, raising doubts about earnings at lenders such as Wells Fargo, Bank of America and others.

WASENDORF GETS 50 YEARS JAIL FOR FRAUD - A federal court in the United States sentenced the ex head of collapsed future broker Peregrine Financial Group, Russell Wasendorf Sr., to 50 years in prison.

NYT

* The Justice Department has sued to block Anheuser-Busch InBev's proposed $20.1 billion deal to buy control of Grupo Modelo, the first major roadblock in a decade of consolidation by brewers around the world.

* A bankruptcy court judge approved a broad settlement deal on Thursday that paves the way for MF Global customers to recover much of the $1.6 billion that disappeared when the brokerage firm blew up in 2011.

* European antitrust officials on Thursday accused drug giants Johnson & Johnson and Novartis of colluding to delay the availability of a less expensive generic version of a powerful medication often used to ease severe pain in cancer patients.

* James Gorman, chief executive of Morgan Stanley, will receive a huge raise in his base salary this year, but his overall pay package for 2012 was down from 2011, according to a regulatory filing.

* Pfizer Inc's animal health unit, known as Zoetis, raised $2.2 billion in its initial public offering on Thursday, exceeding expectations by pricing its stock at $26 a share, above the expected range of $22 to $25 a share. The sale values the company at about $13 billion.

* Roomy Khan, a central figure in the investigation that led to the conviction of hedge fund manager Raj Rajaratnam, was sentenced to one year in prison on Thursday for illegally passing inside information and obstructing justice.

* Fabrice Tourre, the Goldman Sachs trader accused of misleading clients over a controversial mortgage deal, is no longer working at the firm.

Canada

THE GLOBE AND MAIL

* Canada will begin a two-year stint at the helm of the eight-nation Arctic Council amid a clamor of competing calls for leadership, as the ice recedes and the race heats up to extract resource riches while protecting a fragile and now-exposed environment.

* Toronto Mayor Rob Ford is publicly at odds with a key member of his team again, this time in a he-said, she-said spat with the Toronto Transit Commission chair.

The verbal tussle over the approval last week by the transit commission of a 15-year sole-source contract is the latest example of Ford's difficulty seeing eye to eye with even fiscal conservatives on council.

Reports in the business section:

* The Canadian economy expanded at its fastest pace in more than half a year, but the bigger picture is still one of slow growth. The country's gross domestic product rose 0.3 percent in November, Statistics Canada said Thursday, its strongest showing in seven months as auto makers and oil firms ramped up activity.

NATIONAL POST

* Prime Minister Stephen Harper says while some of his Conservative Members of Parliament may not agree, abortion is legal in Canada. Harper made the comments while under questioning in the House of Commons over a letter written by three Tory MPs who want the Royal Canadian Mounted Police to investigate hundreds of abortions as possible homicides.

FINANCIAL POST

* Two of Canada's biggest retailers, Best Buy Canada and Sears Canada Inc, announced layoffs Thursday in what is shaping up to be a turbulent and competitive year for the country's retail sector.

China

PEOPLE'S DAILY

-- Premier Wen Jiabao pledged that China would continue its opening up policy during a meeting with foreign experts on Monday.

SHANGHAI SECURITIES NEWS

-- The People's Bank of China (PBOC) drained a net 300 billion yuan ($48 billion) via reverse bond repurchase agreements in its open market operations in January as the country's interbank market was flooded with cash.

-- The recent serious pollution in Beijing has given rise to suspicion of the quality of China's fuel and gasoline.

CHINA SECURITIES JOURNAL

-- Sources say Chinese authorities have suspended a plan to expand an experimental property tax now levied in a few cities including Shanghai and Chongqing.

-- A monthly index issued by China's national fund for protecting stock investors shows that in January, investor confidence in the domestic equity market reached its highest since April 2011 as the main Shanghai Composite Index began a sharp rebound since early December.

CHINA BUSINESS NEWS

-- High costs and bureaucracy have made 78 percent of Chinese firms feel it is difficult to operate in the European Union, according to a survey by the European Union Chamber of Commerce in China.

-- In a move aimed at strengthening personal data protection, companies will be instructed to delete customer information after use, according to new guidelines implemented on Friday.

Fly On The Wall 7:00 AM Market Snapshot

ANALYST RESEARCH

Upgrades

AB InBev (BUD) upgraded to Outperform from Market Perform at BernsteinArthur J. Gallagher (AJG) upgraded to Outperform from Market Perform at William BlairAudience (ADNC) upgraded to Hold from Sell at Deutsche BankChubb (CB) upgraded to Buy from Hold at Deutsche BankDeutsche Bank (DB) upgraded to Buy from Neutral at CitigroupEricsson (ERIC) upgraded to Neutral from Underperform at Credit SuisseGameStop (GME) upgraded to Overweight from Neutral at Piper JaffrayGreenway Medical (GWAY) upgraded to Strong Buy from Market Perform at Raymond JamesNeutral Tandem (IQNT) upgraded to Market Perform from Underperform at Raymond JamesOracle (ORCL) upgraded to Outperform from Market Perform at BMO CapitalPACCAR (PCAR) upgraded to Outperform from Market Perform at Wells FargoVerizon (VZ) upgraded to Overweight from Neutral at Piper JaffrayW. R. Berkley (WRB) upgraded to Hold from Sell at Deutsche BankWMS Industries (WMS) upgraded to Neutral from Sell at GoldmanWynn Resorts (WYNN) upgraded to Buy from Neutral at Janney Capital

Downgrades

AB InBev (BUD) downgraded to Hold from Buy at Societe GeneraleARMOUR Residential (ARR) downgraded to Neutral from Buy at BofA/MerrillAlkermes (ALKS) downgraded to Neutral from Buy at BofA/MerrillAmerseco (AMRC) downgraded to Perform from Outperform at OppenheimerBob Evans (BOBE) downgraded to Hold from Buy at KeyBancBrightcove (BCOV) downgraded to Outperform from Top Pick at RBC CapitalColfax (CFX) downgraded to Hold from Buy at KeyBancConstellation Brands (STZ) downgraded to Neutral from Buy at BofA/MerrillConstellation Brands (STZ) downgraded to Neutral from Buy at GoldmanCopart (CPRT) downgraded to Hold from Buy at BB&TEdison International (EIX) downgraded to Neutral from Buy at SunTrustHSBC (HBC) downgraded to Neutral from Buy at CitigroupHarris Teeter (HTSI) downgraded to Hold from Buy at BB&THarris Teeter (HTSI) downgraded to Market Perform from Outperform at BMO CapitalHealthSouth (HLS) downgraded to Hold from Buy at Deutsche BankHologic (HOLX) downgraded to Reduce from Neutral at SunTrustLife Time Fitness (LTM) downgraded to Market Perform from Outperform at William BlairMasterCard (MA) downgraded to Market Perform from Outperform at Wells FargoQuiksilver (ZQK) downgraded to Neutral from Outperform at RW BairdRoyal Dutch Shell (RDS.A) downgraded to Underperform from Neutral at BofA/MerrillTime Warner Cable (TWC) downgraded to Hold from Buy at Deutsche BankTime Warner Cable (TWC) downgraded to Market Perform from Outperform at Wells FargoUPS (UPS) downgraded to Neutral from Buy at CitigroupViacom (VIAB) downgraded to Neutral from Overweight at Piper JaffrayWhirlpool (WHR) downgraded to Outperform from Strong Buy at Raymond James

Initiations

Blue Nile (NILE) initiated with an Outperform at Wells FargoEdwards Lifesciences (EW) initiated with a Buy at Janney CapitalHelmerich & Payne (HP) initiated with a Neutral at Credit SuisseNCI Building Systems (NCS) initiated with a Buy at BB&TNabors Industries (NBR) initiated with an Underperform at Credit SuisseNational Oilwell (NOV) initiated with a Neutral at Credit SuisseOceaneering (OII) initiated with a Neutral at Credit SuisseOil States (OIS) initiated with an Outperform at Credit SuissePatterson-UTI Energy (PTEN) initiated with a Neutral at Credit SuissePrecision Drilling (PDS) initiated with a Neutral at Credit SuisseShutterfly (SFLY) initiated with a Market Perform at Wells FargoSunshine Heart (SSH) initiated with an Overweight at Piper JaffrayZoetis (ZTS) initiated with a Buy at ISI Group

The JPMorgan Chase (JPM) trader known as the "London whale"--Bruno Iksil--tried to alert others at the bank to mounting risks months before his bets ballooned into more than $6B in losses, sources say, the Wall Street Journal reportsAsian manufacturing data today suggested the region's economic recovery is continuing. HSBC's China PMI reached a two-year high of 52.3 from December's 51.5, while the official PFLP number fell to 50.4 from December's 50.6, the Wall Street Journal reportsDell (DELL) is close to an agreement to sell itself to a buyout consortium led by its founder and CEO Michael Dell and private equity firm Silver Lake Partners, with a deal coming as soon as Monday, sources say, Reuters reportsAirbus (EADSY) studied alternatives to lithium-ion batteries for its next jet, the A350, and has time to adapt to any rule changes prompted by the problems that have grounded Boeing’s (BA) 787 Dreamliner, says CEO Fabrice Bregier, Reuters reportsAnheuser-Bush InBev (BUD) may have to give up more control of U.S. beer distribution or sell a brewery to settle an antitrust lawsuit by the U.S. to block its $20.1B takeover of the rest of Grupo Modelo SAB (GPMCF), Bloomberg reportsEquity funds attracted six times the money that went into bonds in the week ended January 30, according to a Citigroup (C) report that cited EPFR Global data. Stock funds drew $18.8B, exceeding the $3B that went into bonds, as 58% of the equity inflows went into North American funds, with exchange-traded funds being the largest beneficiaries, the analysts wrote, Bloomberg reports